Solana (CRYPTO:SOL) is among the top cryptocurrency projects I haven’t really had the chance to dive too deep into here just yet. That’s okay, because there’s plenty of time to discuss what this winner has done, and where it could be headed.

For early investors in Solana, the returns have been incredible. A $1,000 investment in Solana on Nov. 21, 2020, would have grown to $110,133 by 2021, according to CoinMarketCap data. Indeed, this token’s recent returns have beaten those of Bitcoin and Ethereum, two of the most prominent crypto projects out there. So, it’s a project worth diving into.

The real question most investors have is whether this growth can continue. I’m going to dive into what Solana does, and what the bull case is behind another move higher in this token.

Key Points About This Article:

• Solana is among the top crypto projects that doesn’t get as much coverage as it should, given what it does.
• Given this crypto’s impressive long-term returns, expectations remain high as to where this token could be headed over the long-term.
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Just What Exactly Is Solana?

I think it’s important to discuss what a particular crypto project is before diving into it, as many projects aren’t as well known as Bitcoin or Ethereum.

Solana is a layer-1 network like Bitcoin and Ethereum, but has positioned itself as a so-called “Ethereum Killer,” operating with a unique proof-of-history consensus relative to Ethereum’s proof-of-stake system and Bitcoin’s proof-of-work system.

What this means is that the Solana ecosystem is looking to be the foundational layer decentralized applications are built upon (like Ethereum), but it uses different infrastructure to get there. By ordering transactions according to their time stamps, Solana has devised a way to process far greater transactions much quicker and at a lower cost than Ethereum. That’s a key advantage, given Ethereum’s processing fees can be significant.

Solana’s energy-efficient approach has led to market share gains, and some of the most exciting new projects being launched on its platform. From DeFi applications to meme coins and NFTs, there’s a lot happening on the Solana blockchain. That’s why so many investors like this project right now, and why it’s the fifth-most-valuable crypto project in the world right now.

Recent Solana Trends

Top Solana meme coins are gaining plenty of attention in the market, with Dogwifhat surging to a market valuation of more than $2 billion, up more than 1,100% over the past year alone. These sorts of returns have driven more investors to the Solana blockchain, and this is one of many examples of how Solana-based applications and projects are driving aggregate demand and network effects for this large project over time. 

Solana’s price performance has been mixed of late, though this token did see a mid-September surge on shifting market sentiment. While sentiment has since soured somewhat in this space, traders and technical investors are eyeing key support levels at the 100-day exponential moving average crossover. We’ll have to see how Solana performs in the coming days, and whether new technical indicators are born. But from a fundamental standpoint, there’s a lot to like about what’s going on behind the scenes with this top layer-1 network right now.

Could a Spot ETF Be On the Horizon?

Another key potential catalyst investors are watching with Solana is the potential for a spot ETF to be approved, similar to the vehicles the SEC approved for Bitcoin and Ethererum earlier this year. Such an approval would legitimize Solana as a top crypto asset, and allow institutional money managers to start placing bets on this top project and participate in its rise. 

Solana has emerged as a top contender for a spot ETF as the fifth-largest cryptocurrency by market cap, and I do think this is a project with a solid case for such an investment vehicle to at least be considered. Various proposals are on the table, but time will tell if regulators will give such ETFs the green light. For now, speculative juices will continue to flow under the surface, and we’ll have to see how much of this anticipation is ultimately warranted over time. 

Overall, I think Solana is a crypto project with more under the hood than most. In terms of top options in this space long-term investors may want to consider, Solana remains a top choice of mine right now.

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